In the November 2017 C12 Business Group materials, they tackled the touchy subject of fraud in the work place, especially for a small to medium sized business. They shared some interesting statistics and some interesting information about how owners address, and in some cases avoid, these issues.
First of all, they found that many owners don’t put safeguards and double-checks in place because they don’t want to seem untrusting of their staff. This is the wrong way to look at this – anyone responsible for your money would welcome the owner’s interest and be relieved to know there are safeguards for the company as well as the employee.
As an owner, you are responsible to have clear guidelines for your staff related to the handling of the company funds, as well as other responsibilities. You are also responsible for the overall health and well-being of the company, providing good stewardship for the entire staff that counts on having a job with you tomorrow. Lastly, you owe it to yourself to safeguard your investment of time, personal guarantees, equipment investments, and similar. You have a lot on the line and should take steps to protect your investment.
According to the C12 materials which have source references, 50% of small- to medium-size businesses (SMB) will experience fraud at some point in their business life cycles, costing an average of $114,000 per occurrence, usually at the hands of a highly trusted employee. SMB’s with fewer than 100 employees have a 30% change of experiencing fraud. In 95% of fraud cases, the perpetrator took some effort to conceal the fraud, most commonly by creating and altering physical documents.
Open your own bank statements; get online and check where those electronic payments are going; check the signatures on the checks; learn how to read your financial statements. If you’d like to talk through rolling out some of these safe guards, we’d be happy to talk with you and brainstorm some ideas – 630-850-9039. – CMW